JP Morgan Reiterates “Neutral” Rating on McCormick & Co. (MKC)
JP Morgan reported on Friday that it has maintained a “Neutral” rating on spice maker, McCormick & Co. (MKC).
Analyst Ken Goldman commented, “McCormick reported pro forma 2Q13 (May) of $0.61, in line with Street estimates. The top line grew 1.9% Y/Y, slightly lower than the 2.3% consensus. The gross margin was a bit lighter than the Street expected (39.3% versus 39.8%) and the SG&A margin was a bit lighter too (27.4% versus 27.7%). We are excluding $4MM in acquisition costs from our model. The Consumer segment’s top line grew 3.9%, in line with our expectation. The margin excluding the acquisition costs was 15.5%, 60 bps above our forecast. The Industrial segment’s revenues were down 1% Y/Y, lower than the +1% we had forecast. Sales continue to be impaired by QSR demand both in the US and China. The margin came in at 6.9%, 30 bps under our model.”
McCormick & Co shares were mostly flat during pre-market trading Friday. The stock is up 11% YTD.
The Bottom Line
Shares of McCormick & Co. (MKC) have a 1.93% yield, based on Thursday’s closing price of $70.59.
McCormick & Co. (MKC) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.
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